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McNerney: We Need New Energy Technologies

Energy and Environment Policy Briefing

What are the prospects for passing comprehensive energy legislation in Congress this year and what will the bill likely contain?

Is it possible to reconcile the need for economic development in industrial areas with the need to protect the planet?

What will the climate change debate in the House be like this year?

What is the state of our national parks and how do the health of our national parks affect the climate change debate?

What do your experiences working in the energy industry tell you about where the debate on energy policy should be headed?

I was working on my mathematics Ph.D. in the 1970s at the beginning of the first OPEC oil embargo. Like many Americans, I was astounded by how quickly a few countries could threaten our nation’s security and economy. That experience motivated me to pursue a 20-year career in developing new energy technology. I started as a contractor at Sandia National Laboratories, engineered turbines for a wind energy company, developed smart grid technologies and ultimately started my own wind turbine manufacturing business.

In the 1970s, our nation’s push for new energy resources was motivated by economic and security concerns. Those issues remain paramount today, but we are also now aware of the threat posed by climate change. We simply can’t afford to be nonchalant about where America’s energy comes from. Our nation’s security, the strength of our economy and the stability of our climate are all tied to how we get our energy. Fortunately, America has the ingenuity to develop new sources of clean energy, the ability to use power more efficiently, the means to reduce emissions and the opportunity to create millions of high-quality, “green collar” jobs.

A first step toward America’s energy independence is to invest in the development of new technologies. From my own experience, I know firsthand both the challenges this involves and the tremendous technological progress that can be made. I started building wind turbines when the industry was in its infancy. During my first job at a wind energy company, we installed a turbine in the field and called in the investors for its maiden operation. We turned it on, and the blades flew off while everyone ran for cover.

However, we persisted through these early challenges and eventually planted thousands of machines on the hills overlooking what is now my Congressional district. With existing incentives, well-designed and well-located wind energy systems are now cost-competitive with fossil fuels and are a major source of electricity across the globe.

Wind, solar, geothermal and other renewable resources have now become commercially viable sources of energy. We still need to build and expand on these advances. I’ve worked hard to extend the tax credits that have been fundamental to the growth of clean energy technologies. However, policies that incentivize the deployment of renewable energy resources should be consistent and long-term to provide certainty to investors.

We should not forget the lessons of the 1980s, when many energy tax credits were allowed to expire. American renewable energy companies languished, while foreign competitors grew by leaps and bounds using technology that Americans created. We can’t afford to let that happen again.

A second step toward achieving our national energy goals is to make better use of the resources we have by enhancing energy efficiency, modernizing our electrical grid, and developing “smart” electrical infrastructure. America’s electrical system is like a major highway — during certain times of the day, it becomes jammed with users. As a result, providers turn to power from backup plants that are often less efficient. Excessive demand strains the grid and contributes to service failures.

“Smart grid” technologies interface with the electrical system to reduce demand during these peak times. In the 1990s, I helped develop a low-cost residential power meter with smart grid capabilities. The meter was designed to monitor and communicate with home and office appliances so that consumers could choose to consume less power during periods of peak consumption.

It is smart technologies like these that will play a fundamental role in meeting our energy goals. That’s why I recently introduced the Smart Grid Advancement Act, a bill that will spur their implementation.

The third step toward achieving our energy goals is to implement a market-based cap-and-trade system that will facilitate economic growth. “Cap” means creating limits on carbon emissions by requiring companies to obtain allowances in order to emit carbon or sell carbon-based fuels. “Trade” refers to the allowances being traded or sold in a transparent, well-regulated market. Trading is crucial because it provides strong incentives for entrepreneurs to develop efficiency improvements and new forms of energy.

A well-designed cap-and-trade system will gradually and predictably lessen emissions, and the revenue generated can be used to reduce consumer energy costs, increase efficiency, and drive down the cost of clean energy sources. However, in implementing cap and trade, we must first protect consumers, prevent abuse of the system, and preserve American manufacturing jobs.

We can, for example, give strong incentives for home efficiency improvements and the purchase of more efficient vehicles. A spectrum of energy incentives will help create new jobs weatherizing homes, building efficient cars and trucks, and harvesting energy from wind, solar, biofuels, geothermal and other renewable resources. Moving America toward energy independence can be synonymous with creating millions of “green collar” jobs that our country needs.

As when I started my career in renewable energy, America is again at a critical point in its history. We face threats to our national security, a struggling economy, and the danger of climate change. Despite these challenges, the opportunities ahead are great. I think that we will look back on these years as a time when our country became safer and stronger because Americans used ingenuity and resourcefulness to meet our energy needs.

Rep. Jerry McNerney (D-Calif.) is a member of the House Energy and Commerce Committee.

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